Life insurers turned to their state regulators in 2008 to benefit from relaxed statutory accounting standards that boosted their statutory income, capital surplus, or both, according to regulatory data.

A handful of life insurers, including Hartford Financial Services Group (HIG), Lincoln National Corp. (LNC) and Allstate Corp.'s (ALL) life insurance unit have already discussed their requests to use so-called permitted accounting practices that allow them to reduce their reserves against potential losses, or allow them to expand what they consider as capital in their state financial filings.

The changes have the effect of making insurers' capital position look stronger on paper, by relaxing what life insurers call overly conservative rules set by state insurance regulators.

Other insurers have followed suit and made the same request, and data released Monday by the National Association of Insurance Commissioners indicate that regulators looked favorably on the requests.

Hartford, Lincoln National and Allstate were among the insurers that boosted their capital surplus through a change in their deferred tax asset accounting that allows the insurers to realize deferred tax assets over three years rather than the usual one year, and raise the asset-recognition limit to 15% from 10% of statutory capital and surplus.

NAIC said that accounting change was also permitted for Aviva Group (AV.LN), American International Group (AIG), MetLife Inc. (MET), Conseco Inc. (CNO), Principal Financial Group (PFG), Nationwide Financial Group and Aegon (AEG).

Some insurers, such as Lincoln National, Hartford, Protective Life (PL), and Pacific Life received permission to relax one or more standards used to set reserves.

-By Lavonne Kuykendall, Dow Jones Newswires; (312) 750 4141; lavonne.kuykendall@dowjones.com